One of the things that happens when you have austerity is that wages get lower, and some people think lower wages in the short run can increase corporate profits.
Interpretation
Austerity can lead to lower wages, which some believe may boost corporate profits temporarily.
This quote by Joseph Stiglitz addresses the paradoxical notion that implementing austerity measures can reduce wages, potentially leading to short-term increases in corporate profits. It highlights the complex relationship between wage levels, corporate profitability, and the broader economic impact of austerity policies, suggesting that short-term gains for businesses can come at the expense of workers' livelihoods.
In practice
Discussing the economic impacts of austerity measures in a public forum.
Free migration within Europe means that countries that have done a better job at reducing unemployment will predictably end up with more than their fair share of refugees. Workers in these countries bear the cost in depressed wages and higher unemployment, while employers benefit from cheaper labor.
I don't think we can have democracies that work where most of the people are not benefiting economically, where most of the people are worried about their job security.
Let me put it very forcefully: No large economy has ever recovered from an economic downturn through austerity. It's not going to happen in the United States, and it's not going to happen in Europe.
What separates developing countries from developed countries is as much a gap in knowledge as a gap in resources.
One of the arguments I make for the failure of the euro is that, at the time it was being constructed, there was a 'neo-liberal' ideology which said that all we need to do to make this thing work is to get deficits low, keep inflation low, and take down barriers, and then everything would be fine.
Trump sees the world in terms of a zero-sum game. In reality, globalisation, if well managed, is a positive-sum force: America gains if its friends and allies - whether Australia, the E.U., or Mexico - are stronger. But Trump's approach threatens to turn it into a negative-sum game: America will lose, too.
Passive commerce . . . should thus . . . [compel us] to content ourselves with the first price of our commodities, and to see the profits of our trade snatched from us, to enrich our enemies and persecutors. That unequalled spirit of enterprise . . . an inexhaustible mine of national wealth, would be stifled and lost; and poverty and disgrace would overspread a country, which, with wisdom, might make herself the admiration and envy of the world.
Measures which serve to abridge the free competition of foreign Articles, have a tendency to occasion an enhancement of prices.
I think one of the most important facts of basic income would be that it's not only a redistribution of income, but also of power. So the cleaners and bin men would have a lot more bargaining power.
In financial terms, my sense is that the distribution of wealth, unequal as it is, is self-perpetuating, and, especially in a linked and accelerating world, the rich get ever more quickly richer while the poor get ever more speedily poorer.
When money is controlled by a few it gives that few an undue power and control over labor and the resources of the country. Labor will have its best return when the laborer can control its disposal.
The trouble with the profit system has always been that it was highly unprofitable to most people.
Subscribe for the occasional hand-picked quote. No noise.